Irrational Fear of a Democratic Victory

The Republican revolution seems to have won the hearts and minds of the most important demographic of all: corporate boardrooms. Are Democrats really going to suddenly transform into socialists, or worse, Greens? No, I doubt it. The Democrats are quite willing participants in American corporate/crony capitalism as well - does anyone remember the Go-go 90s? The 1996 Telecommunication Deregulation Act? Yet apparently, the corporate world, especially pharmaceutical and energy companies, fear the Democrats. How many Senators (R and D) are millionaires? All of them, right?

Fearing a Democratic Victory, Drug Makers Fund Key Races - WSJ.com
Few businesses have more at stake in next month's congressional elections than pharmaceutical makers. Assailed by Democrats, drug companies are pouring millions of dollars into close races, giving some Republicans a financial edge. In the process, the industry is becoming not just a campaign backer, but also a campaign issue.

Here's some insight into how Congress works: corporate donors get priority over all else. The Public Good is simply a marketing term, trotted out during election time. The reality is much sleazier.

Companies and business groups have long thrown money at candidates to further their interests. But with a Democratic victory increasingly likely, few recent elections have been so critical, particularly for the drug industry. On the campaign trail, Democrats frequently lump “Big Pharma” with “Big Oil” in attacking Republican ties to industry. Within the first 100 hours of taking over the House, promises House Democratic Leader Nancy Pelosi, Democrats will rewrite the prescription-drug benefit to take away most of the advantages it handed to pharmaceutical companies.

“It'll take five minutes” to make the biggest change of all -- the proposal to let the government negotiate prices, Ms. Pelosi told a group of about 100 retirees in Sunrise, Fla., earlier this month. She said the benefit was a product of “corruption, putting pharmaceutical companies and HMOs first at the expense of America's seniors.”

Congressional Democrats propose lifting a ban on the broad-scale reimporting of inexpensive drugs and could toughen the drug-approval process. They've talked, too, of holding hearings into conflicts of interest among Republicans now working for the industry.

Through early September, drug-company political action committees had given about $8.7 million to campaigns, compared with $7 million for all of 2002, the last midterm election, according to CRP. Employee contributions are up, too, rising to about $5 million from $3.3 million four years ago. About 69% of the industry's campaign contributions are going to Republicans.

...Congressional Republican leaders prevented Medicare from negotiating prices with the industry. They also killed a proposal that would have allowed the government to offer its own coverage in competition with those sold by private companies. The industry successfully argued that the government's clout would mess up prices and stifle innovation.

Sen. Jim Talent of Missouri benefited from $900,000 in ads this year touting his role in the prescription-drug benefit, according to a tally by Americans United for Change, a liberal advocacy group with close ties to congressional Democrats. Mr. Talent made a similar pitch in two TV ads as well as in a recent debate with his Democratic challenger, Claire McCaskill.

Other industries are also pouring money into races in the hopes of protecting their favored candidates. Oil and gas interests worry about a Democratic Congress axing subsidies and have spent $13.6 million on the campaign so far, of which 83% has gone to Republicans. For all of 2002, they and their employees contributed $14.8 million in hard-money donations. Montana's troubled Republican Sen. Conrad Burns is the second-biggest recipient of oil money, according to CRP. He supports drilling in the Arctic National Wildlife Refuge and sits on the Senate Energy and Natural Resources Committee.

Electric utilities, fearing tougher environmental rules, have contributed $11.9 million, with 66% going to Republicans, compared with $12.8 million in 2002. Commercial banks, bracing for tighter lending standards, account for $19.2 million, 63% of which is going to Republicans. That's already more than 2002's $16.5 million.

Despite campaign-finance laws designed to limit the influence of big business and unions, the 2006 midterm elections are on track to be the most expensive ever, costing about $2.6 billion, according to a new study by CRP. That compares with about $2.2 billion in 2002. Business interests account for about three-quarters of this year's contributions.

The Republican-controlled Congress has been kind to drug makers. As the prescription-drugs benefit was crafted, Republicans battled not just Democratic critics but also fiscal conservatives in their own party who opposed creating the expensive government program.